Chipotle (CMG) shares fell more than 7% on Tuesday after the company announced the resignation of its CEO Brian Niccol, who will take on the same role at Starbucks (SBUX) starting next month.
Niccol has been CEO of Chipotle since 2018. Scott Boatwright, COO, will serve as the company’s interim CEO.
Niccol has been instrumental in Chipotle’s recovery in recent years as the company recovered from an E. coli crisis that began in 2015 and weighed on the stock for years.
In the year before Niccol joined the company, Chipotle’s annual revenue was about $4.5 billion; by 2023, revenue had more than doubled, totaling $9.9 billion. Over the past five years, the stock has risen more than 240%, while the S&P 500 has gained just 85%.
As part of the executive restructuring, Chipotle CFO Jack Hartung, who had announced his intention to retire in 2025, has agreed to stay on as Chiptole’s president of strategy, finance and supply chain “indefinitely.”
“Chipotle is in a very good position,” Wedbush analyst Nick Setyan told Yahoo Finance. “They’re in very good hands… I credit both gentlemen here taking the helm with the turnaround, as well as Brian Niccol. So I think they’re in very good hands.”
He added: “Frankly, they’re running on autopilot. And not much needs to change.”
Danilo Gargiulo, senior research analyst at Bernstein, agreed that Chipotle is well positioned for the change.
“The brand has evolved from being purely CEO-driven and -led to being a brand,” Gargiulo said. “And I think over time it’s proven that it’s bigger than its own management… Right now we’re talking about a potentially standardized approach that Chipotle needs to deploy in more areas and increase the number of stores.”
Josh Schafer is a reporter at Yahoo Finance. Follow him on X @_joshschafer.
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